Business Risks and More
① Economic situation surrounding the business |
Our group operates businesses in Japan, Malaysia, and China, and is affected by economic trends and demand fluctuations in each market. In the market, economic slowdowns, changes in the demand structure, and intensifying price competition may have an impact on the Group's business results and financial condition. |
② Dependence on specific suppliers |
Our group endeavors to procure raw materials, parts, etc. from as many business partners as possible. However, if we are trying to procure higher quality products at competitive prices, we may focus on specific sources. Additionally, for materials and parts that require special technology and performance, the sources that can supply them may be limited. Therefore, if supplies from these suppliers are interrupted due to unforeseen circumstances, or if we are unable to procure them in a timely manner, production of our products may be halted or costs may increase. These risks may materialize due to unexpected events at primary and secondary suppliers, as well as emergencies such as natural disasters, fires, and terrorism, and the effects of infectious disease outbreaks. The Company is working to strengthen collaboration with suppliers and minimize the impact, but if the supply and demand situation becomes tighter than expected or the impact is prolonged, it may affect the Group's business performance or financial condition. |
③ Product quality |
Our group is doing our best to ensure optimal quality according to the characteristics of our products. However, in the event of a large-scale recall or improvement measures due to product defects or malfunctions, product evaluation, significant cost increases, declines in corporate image and sales, etc. may affect the Group's business results or financial condition. |
④ Legal procedures |
The Group faces the risk of becoming the subject of litigation in connection with its domestic and overseas businesses. If any of these lawsuits result in an unfavorable outcome for the Group, it could have a significant impact on the Group's business results and financial condition. |
⑤ Intellectual property infringement |
In order to differentiate our products from those of other companies, our group strives to acquire intellectual property that is useful for our business, while also striving to prevent infringement of third party intellectual property rights. However, there is a possibility that a third party will file a lawsuit regarding intellectual property or that a third party will infringe on the Group's intellectual property rights, and in this case, the Group's business results and may have a significant impact on our financial situation. |
⑥ Information security |
Information systems have become extremely important in our group's business activities, and we strive to protect information assets such as systems and data. However, if important operations are interrupted or confidential data is leaked due to a disaster, cyber attack, unauthorized access, or other unforeseen circumstances, the Group's business performance and financial condition may be significantly affected. |
⑦ Increase in product material prices |
Rapid fluctuations in supply and demand, disasters, and changes in the political situation in producing countries may cause material prices to soar and manufacturing costs to rise. If the manufacturing costs of our products increase due to unexpected demand or fluctuations in market conditions, our group's business results or financial condition may be affected. |
⑧ Exchange rate fluctuations |
Fluctuations in exchange rates when converting into yen may affect the Group's business performance and financial condition. |
⑨ Impact of natural disasters, accidents, infectious diseases, etc. |
Our group has manufacturing bases and other facilities in Japan, Malaysia, and China. Natural disasters such as large-scale earthquakes, typhoons, floods, etc., accidents such as fires, and outbreaks of infectious diseases in these areas may cause serious disruptions, such as interruptions to the operations of the Group or its business partners. In the event that a natural disaster, accident, or infectious disease occurs on a scale that exceeds expectations, resulting in damage to manufacturing bases and other facilities, or delays or suspensions in parts procurement, product production and sales, logistics, etc., the Group's business results may be affected. or it may affect our financial condition. |
The above is not an exhaustive list of all risks related to our group, and there are risks other than those listed. Any of these risk factors may have an impact on the Group's business results or financial condition. |